The new operator of the passenger train service between Sault Ste. Marie and Hearst hailed the announcement as a new beginning and a new future for Northern rail service.

B. Allen Brown, CEO of Railmark Canada, was even happier Wednesday morning when the late night federal funding announcement was followed up by Transport Canada that Railmark has received its certificate of approval to operate on new legislation.

“There are some requirements and coordination that we expected but we're certainly moving forward today,”

Brown told The Sault Star. “We can now start telling our prospective employees about the transition and work on the transition and coordination plan.”

Transport Canada Minister Lisa Raitt announced late Tuesday night that the government will provide $5.3 million of funding over three years for the continued operation of the passenger rail service.

“Our government was pleased to provide funding to maintain passenger rail service between Sault Ste. Marie and Hearst. I thank MP Bryan Hayes for all his hard work and dedication on this file,” Raitt said.

The money will be filtered through the City of Sault Ste. Marie and logistical agreements will be made between the city, Railmark and the government over the next few weeks.

There will be no interruption of service. CN will continue operations for the next few weeks as the transition occurs.

Brown cautions that the funding announcement doesn't mean the long-term “business as usual” for the train.

“At the end of the day we are not going to be business as usual because that's what we told the government,” Brown said. “I just inherited a business that loses $2.2 million a year and we want to transform that business so it can break even in the sixth year and turn a profit in the seventh year and that's the plan we've created.”

Brown promises better marketing, especially to the forgotten mid-west, better communication with stakeholders and users and an improved customer service and product base that will attract more riders for different reasons.

A relaunch of the snow train, dinner trains and specialty trains will be added in due course, he said.

Meanwhile, Railmark is the first company to receive its certificate to operate a rail under the new legislation created after the Lac-Megantic rail disaster that occurred in July 2013 after rail cars carrying crude oil rolled downhill, derailed and exploded, killing more than 40 people and creating the fourth largest rail disaster in Canadian history.

Sault MP Bryan Hayes said he's “very pleased this has happened and I look forward to Railmark getting things off the ground.”

He said that the approval was provided in a “very short time frame” and came late Tuesday night during a treasury board meeting.

“I have faith in Railmark and the stakeholder's group and the plan to increase the passenger side of the business,” he said.

Hayes said he expects the announcement to also be pleasing to tourist operators, property owners and communities along the train line.

“The stakeholder committee has done a marvelous job and will continue to stay in tune with the operations and the plans,” he said.

Mayor Christian Provenzano said he believes it's the City of Sault Ste. Marie who will be responsible for the funding and there are some legal obligations that the city needs to meet that council will need to approve.

In addition, he believes there needs to be some agreements sent out between the parties.

“I'm pleased there's an arrangement and council has some work to do here to ensure we're satisfied and protected through contracts,” he said.

Sault Ste. Marie EDC CEO Tom Dodds said flowing the money through the City, a responsible financial entity, is appropriate and a prudent course of action by Transport Canada.

He doesn't expect any issues with process.

Brown said the federal government is aware that he's still looking for two additional years of funding assistance.

“We understand that position too,” said Hayes. “We recognize that there should be a review after three years and assess the need for the last $1.7 million from the federal government. Maybe at that point that money won't be required, or there will be less of a requirement. The government will do its due diligence once again at that point.”

Dodds said it's also important to know that as a result of the local stakeholder committee's work, the rail lines removal from that program has now been reinstated.

“We were removed from the program and now we have been reinstated in that program and I credit the stakeholders with that,” Dodds said. “Now our job is to advocate to successfully keep it and what's more important, is that (Brown) is prepared to agree to the three-year term.”

Linda Savory-Gordon, co-chair of the Coalition for Algoma Passenger Trains (CAPT) said she's also pleased the funding has been approved by Transport Canada but realizes there is still much work to be done.

“We're excited for this new service to begin but we agree that there needs to be some change that will result in more communication with the stakeholders and a strong attempt to draw more passengers and products to the line,” she said. “We believe this can be made into a real, incredible tourism corridor and we're excited to work with someone who has that same goal,” Savory-Gordon said.

The feeling was echoed by co-chair and Wilderness Island owner Al Errington.

“This is a solid three years,” he said. “We will be there to do the due diligence to determine how the money is spent and those who need to use the train will help guide it and be accountable.”

He attributes the successful funding to the work that Hayes and Algoma-Manitoulin MP Carol Hughes did.

“These politicians collaborated and acted on behalf of their constituents,” he said. “People don't realize how much work (Hayes) did to get this done.”

Errington said it's the passengers who understand the need for the train best.

“We're the ones who understand the train. The train is actually a small community and we want to make it a bigger community,” he said.

Errington expects Ontario tourism to be very strong this year and he wants that momentum to start on the train.

“I'm very excited to get to work on that,” he said.

A year ago, Transport Canada announced that it was cutting its remote access transportation funding – $2.2 million annually – to CN because stops along the route between the two Northern Ontario communities no longer fit the criteria.

The government granted a temporary, one-year hiatus that allowed local stakeholders a chance to regroup, complete a business study showing the economic benefit of the train on the region's economy and devise a plan that would see sustainability of the operation.

It's expected the transition period will take about one month to complete. Passenger train service will continue through that transition.